TO: President Barrack Obama
FROM: Paul McDonald (Secretary General, Economic Growth Institute)
DATE: May 12, 2014
SUBJECT: U.S. Trade Talks with the European Union (E.U)
There have never been successful trade talks between the U.S. and the European Union (E.U). Economic commentators consider the upcoming U.S.-E.U. trade talks to be the most complex and ambitious trade talks around the world. European governments in the 27 nations are backing the planned trade talks because of the understanding of the benefits that would accrue to both the U.S. and the European Union as a block.
It is crucial to consider trade talks with the E.U. because of its estimated largest value of $927 billion in terms of annual goods and services. The trade talks should be considered with the understanding that both the U.S. and the E.U. play an instrumental role in the global economy. Trade relations between these two regions would help secure the world against global financial crises such as the Great Recession that was witnessed in the years 2008-2012.
More so, both the U.S. and the E.U would benefit from the elimination of trade barriers between the two regions. This would lead to an expansion of trade hence promoting the living standards in both regions. For example, the E.U estimates that a successful deal would lead to the expansion of the Gross Domestic Product (GDP) by 0.52%, which is about 120 million euros. The U.S. would also benefit economically because of the achievement of a trade balance with the E.U countries. Multinational companies operating in these regions would also be willing to cross borders hence expanding economic activities in the levels of productions.
Overall, it would be crucial to strike a trade deal with the European Union, as this would not only boost trade between the two regions, but would also help secure the world from economic crises.